QNB Group’s H1 2023 net profit jumps 8% to $2.1bn

Qatar National Bank (QNB) reported a net profit of $2.1bn (QAR7.6bn) in the first half of 2023, up 8 per cent from a year earlier, driven by a surge in operating income and total assets.

QNB said its operating income jumped 14 per cent year-on-year (YoY) to reach QAR18.5bn in H1 2023 from QAR16.3bn in the same period last year due to growth across a range of revenue lines.

The banking group’s deposit base rose by 5 per cent YoY to QAR836bn in the first half of the year, thanks to a substantial inflow of customer deposits. QNB’s loan-to-deposit ratio remained strong at 97.9 per cent as of June 30, 2023 – well within the regulatory limits.

Meanwhile, the Qatari lender’s cost-to-income ratio stood at 20.4 per cent in H1 2023, “one of the best ratios among large financial institutions in the Middle East and Africa”.

The ratio of non-performing loans (NPL) to gross loans stood at 2.9 per cent as of June 30, 2023, reflecting the high quality of the banking group’s loan book and the effective management of credit risk.

QNB Group’s highlights for the financial statements for the 6 months ended 30 June 2023https://t.co/01v12Y8You#QNB #QNBGroup #QNBEcon pic.twitter.com/0zCy64DgEM

— QNBGroup (@QNBGroup) July 10, 2023

However, QNB has so far this year set aside QAR4.7bn “as provision for potential loan losses and NPL coverage ratio remained strong at 99 per cent, reflecting a prudent approach adopted by the group towards non-performing loans”.

The bank’s total assets edged up 7 per cent YoY to reach QAR1.2bn in the first half of 2023, mainly driven by a 7 per cent growth in loans and advances, which reach QAR819bn. QNB’s total equity rose 1 per cent to QAR104bn while earnings per share increased by 9 per cent to reach QAR0.76.

The banking group said its capital adequacy ratio amounted to 19 per cent as of  June 30, 2023, while its liquidity coverage ratio and net stable funding ratio expanded by 146 per cent and 106 per cent, respectively.

“These ratios are higher than the regulatory minimum requirements of the Qatar Central Bank and Basel Committee,” QNB said in a statement.

QNB’s growth strategy

Meanwhile, QNB Group remains the most valuable banking brand in the Middle East with a brand value of $7.7bn up 9 per cent from 2022, according to Brand Finance.

The role as the Official Middle East and Africa  Supporter of the FIFA World Cup 2022, provided the chance for the group to gain exceptional global exposure during the month-long tournament. QNB unveiled its new internet and mobile banking platforms in March to enhance customers’ experience and deliver a seamless digital banking experience.

The new platform uses a variety of technologies to deliver an innovative and unified banking experience across smartphones, tablets and laptops, making customers’ comfort and easy access a priority ensuring that customers can manage all their banking needs wherever they are, and whenever they want.

Earlier this year, the banking group launched a new biometric payment acceptance solution for its merchants in Qatar. Together with its partners, QNB said it will merchants with outlets across the Gulf state to offer customers the simplicity, convenience and security of facial biometric payments.

The innovative solution is based on proprietary facial verification technology developed by PopID, provisioned through QNB’s acceptance network and supported by Visa via tokenisation.

In March, the bank took a groundbreaking step towards innovative technological solutions by being the first bank in the Middle East to implement NCR SelfServ 62 ATM. With the latest technologies such as palm authentication, cash recycling and deposits, the installation of the new ATMs further boosts the bank’s capabilities of its self-service machines and enhances user experience.

Read: Qatar stocks could attract up to $3.5bn on free float plan